Will GBP/EUR break the magic 1.20 mark?

The Pound retracted against the Euro last Friday, following concerns from the Bank of England over UK inflation. Is this just a blip for Pound/Euro rates or a sign of longer term weakness for the pair? The below table provides GBP/EUR exchange rate movements for the past 30 days.

Currency Pair

% Change

Difference on £200,000

GBP/EUR

2.1%

€4800

The 1.20 mark is seen by many investors as a rate of exchange that acts as a barrier for GBP/EUR. In recent weeks, we have seen seven month highs within the market reaching as high as 1.199. In my opinion with the build-up to the election in three week’s time and the early polls suggesting Conservatives have a comfortable lead, I feel this will be viewed as a positive for Sterling and we may see a 1.20 mark broken in the coming weeks.

French elections leave the market volatile

Emmanuel Macron triumphed with an overwhelming victory of 65% in the recent French election. Although this may be perceived as a positive thing for the French people and the Eurozone President Macron's work has just begun, with his lack of support in parliament Macron is going to find it extremely difficult to get the support he needs to push through reform changes. Therefore in my opinion Euro/Sterling exchange rates may remain volatile over the coming weeks and months.

The week ahead

On Tuesday morning, we have growth figures out for the Eurozone and expectations are for the growth rate in Europe to remain consistent. But we must remember that these releases do not always come out as expected, along with inflation data also released on Tuesday morning those were the GBP/EUR requirement may wish to let us know so we can keep you fully up to date with what’s happening.

In my opinion I think we could see Sterling rates push towards 1.20, coupled with the up and coming election clients with imminent requirement should be in touch with their account broker as soon as possible on 01494 725353.

The information on this web site is provided free of charge for information purposes only. It does not constitute advice to any person on any matter. Foreign Currency Direct plc. ("FCD") makes every reasonable effort to ensure that this information is accurate and complete but assumes no responsibility for and gives no warranty with regard to the same.

Exchange rates on this page are interbank rates and indicate where the market is trading to show the performance of a currency pair. They are not indicative of the rates which we offer. The information on this web site is provided free of charge for information purposes only. It does not constitute advice to any person on any matter. Foreign Currency Direct plc. ("FCD") makes every reasonable effort to ensure that this information is accurate and complete but assumes no responsibility for and gives no warranty with regard to the same.